The effects of dry port-seaport integration on sea port performance in Vietnam

Maritime transport, with its ability to facilitate the transportation of large volumes of cargo over long distances at low costs, remains the backbone of globalisation and international trade. However, the literature shows that inefficiencies exist, especially in the container shipping sector, due to a lack of coordination and cooperation between players in the maritime supply chain (for example, between shipping companies and seaports and between seaports and other hinterland operators, such as dry ports), which may negatively affect their performance. Particularly, there is knowledge missing from the existing literature on how the integration between dry ports and seaports, which are key players in the maritime supply chain, impacts seaport performance. To address these gaps in the existing literature, this research aims to explore the dry port - seaport integration (DPSP-I) and its impacts on seaport's performance, especially on port service quality, customer satisfaction, and financial performance in the maritime supply chain and, specifically, the container port context. This study, therefore, poses the following research questions: RQ1: What is the current status of dry port-seaport integration in Vietnam? RQ2: How does dry port-seaport integration impact seaport performance in terms of service quality, customer satisfaction, and financial performance in the context of Vietnam? The results of the comprehensive literature review on maritime supply chain integration and its effects on firm performance indicate that there are many differences between studies in terms of their definitions and measurement criteria of supply chain integration (SCI). Besides that, research in the context of DPSP-I and its impact on seaport performance is scant, especially in developing countries. To address these literature gaps, a conceptual framework depicting the components of DPSP-I and its impacts on seaport performance, specifically service quality, customer satisfaction, and financial performance, was developed under the light of underpinning theories: transaction cost economics (TCE) and relational view (RV). Under TCE theory, integration between dry ports and seaports may be an intermediate form of hybrid governance because relational integration implies the adoption of a strategic connection among ports (dry ports and seaports) characterised by trust, commitment, long-term orientation, and goodwill which can help to avoid opportunistic behaviour, and optimise mutual interest. Meanwhile, from the relational view theory perspective, information, operational, relationship, and geographical integration-components of DPSP-I-may reach beyond firm boundaries and are critical resources that may enhance the competitive advantage of the supply chain and enhance seaport performance. To achieve the research purposes, a sequential mixed method, combining both qualitative and quantitative approaches is employed. The qualitative approach helps to overcome the limitations in the literature of DPSP-I in container seaport systems, while the quantitative approach validates the results from the qualitative method and analyses the effects of DPSP-I on seaport performance. With these considerations, the unit of analysis in this research are members of the maritime supply chain. Specifically, the units of analysis in the first phase are seaport operators, dry port operators, shipping lines, and logistics service providers aiming to qualitatively explore the interrelationships between research variables in the proposed conceptual framework. In the second phase of the study, which aims to examine the impact of DPSP-I on seaport service quality, customer satisfaction and financial performance, the chosen unit of analysis is seaport operators. In the qualitative phase, the snowball sampling method and NVivo_11 software were deployed to collect and analyse the qualitative data collected from fourteen in-depth interviews with senior managers working in the maritime sector in Vietnam. The findings align with the literature in showing that the DPSP-I in Vietnam can be measured through information integration, operational integration, relationship integration, and a newly discovered factor: geographical integration. In addition, it was found that the level of integration varies from low to high, and that DPSP-I has an impact on seaport performance. Consequently, the conceptual framework was revised following the qualitative results, and the survey questionnaire was then constructed accordingly. In the second phase of this research, a survey questionnaire was distributed to 102 container seaports via Qualtrics and with the help of the Vietnam Seaport Association to examine the level of DPSP-I and its impacts on seaports performance in Vietnam. The collected data were coded and prepared, and 88 remaining valid cases were analysed using SPSS and partial least squares structural equation modelling (PLS-SEM) statistical packages. Dry port - seaport integration is found to be a four-factor construct, and all four factors (information integration, operational integration, relationship integration, and geographical integration) were reliable and valid. However, in the context of the maritime sector in Vietnam, in line with the qualitative finding, the practice of DPSP-I varies. Specifically, the most common practice of integration between dry ports and seaports is relationship integration, followed by operational information and geographical integration.  The quantitative findings also illustrate that DPSP-I has a significant positive direct effect on port service quality and customer satisfaction. Interestingly, this integration also significantly indirect affected financial performance, mediated by port service quality. This research contributes to the literature in several ways. First, it is one of the first studies to quantitatively examine the integration of dry ports and seaports and its impact on seaport performance in a developing country like Vietnam; it thus enriches the integration literature in the maritime supply chain domain. Findings from this research also extend the application of the TCE and RV theories in maritime SCI, particularly in the context of developing countries. Meanwhile, understanding how the integration of dry ports and seaports is measured and how it influences seaport performance can help policymakers, port authorities, and operators in Vietnam devise policies and strategies to improve their ports' competitiveness. Specifically, policies and strategies to increase the level of information, operational, and relationship integration can be formulated to help enhance seaports' service quality, customer satisfaction, and financial performance. Findings from this research can also be a useful reference for ports in other countries in advancing the integration and performance of their seaport and dry port systems.